The Financial Services Authority (OJK) is currently exploring the formation of an insurance consortium for the fintech lending industry. This initiative aims to strengthen risk mitigation efforts for online lending platforms in Indonesia.

According to Agusman, Chief Executive of Supervision of Financing Institutions, Venture Capital Companies, Microfinance Institutions, and Other Financial Service Institutions at OJK, discussions are ongoing between the insurance industry and fintech lending providers. The goal is to ensure that insurers have a full understanding of fintech business models and their associated risks.

"One of the steps being explored is forming a consortium among insurance companies," Agusman said in Jakarta on Monday (10/3/2025).

Currently, the fintech lending industry relies on credit insurance products regulated under OJK Regulation (POJK) Number 20 of 2023. This regulation outlines the underwriting guidelines for credit insurance and sharia-compliant financing, ensuring careful risk assessment aligned with general insurance practices.

Agusman further mentioned that a specific insurance scheme tailored for online lending is still under review. This process involves collaboration with the General Insurance Association of Indonesia (AAUI) and the Indonesian Joint Funding Fintech Association (AFPI).

The initiative aligns with the mandate set out in POJK Number 40 of 2024, particularly Article 148, Paragraph 8, which emphasizes risk mitigation for fintech lending providers.

OJK’s data shows that as of January 2025, the fintech lending industry’s outstanding financing grew by 29.94% year-on-year, reaching Rp78.50 trillion. Meanwhile, the industry's non-performing loan rate (TWP90) remained stable at 2.52%, improving from December 2024's figure of 2.60%.

This ongoing dialogue between OJK, insurers, and fintech companies highlights a proactive approach to safeguarding the fintech lending sector, ensuring sustainable growth and risk management.

PHOTO: ESPOS ID

This article was created with AI assistance.